PROPOSALS TO CAP laboratory tests at no more than six per month for MediCal patients in California alarmed clinical laboratories throughout the state. The California Clinical Laboratory Association (CCLA) took immediate steps to counter the proposals.
“This was a budget issue initiated by state bureaucrats,” stated Michael Arnold, legislative advocate for CCLA. We were very much opposed to this. We testified in subcommittee hearings held by both the assembly and senate. Further, all CCLA member laboratories sent letters to subcommittee members outlining the reasons why this proposal should not be enacted.
“I think we did a pretty good job of educating lawmakers about our position,” he continued. “Both budget committees listened to what we had to say and rejected the proposals. The lab test cap was also not included in the overall budget debate taking place at this time in the joint budget conference committee.
“This leads us to believe we have defeated the laboratory test cap for this year,” added Arnold. “However, it is probably going to rear its ugly head again in coming years, because there is already a MediCal cap on prescriptions. The administration argues that laboratory tests should be capped in a similar fashion as prescriptions.”
According to Arnold, lawmakers learned that the proposed laboratory test cap would restrict patients from necessary laboratory tests, because physicians would tend to avoid filing the burdensome “Treatment Authorization Request”
forms (TAR) required for MediCal officials to approve exceptions to the monthly test cap. Further, the administrative cost to comply with this proposal would exceed any cost benefits to the state. It would also create disproportionate burdens for laboratories.
New York enacted a similar cap on Medicare testing several years ago. “At the time this was proposed, laboratories were concerned,” stated Tom Rafalsky, president of the New York State Clinical Laboratory Association (NYSCLA). “Over our objections, the lab test cap was implemented.
“Unlike the proposal in California, our MediCal lab test cap is 18 tests per year,” said Rafalsky. “Certain classes of patients with chronic disease are exempted from the cap. Medicare officials claim the threshold of 18 tests per year only affects a small number of exceptions.
“Laboratories in New York have learned to live with this regulation,” he explained. “It is the doctor who must get override authorization, but the laboratory has to do the billing. Laboratories find it is a problem getting doctors to cooperate.”
Laboratories in other states should be alert to legislative proposals to cap Medicaid lab testing. Things that happen first in California and New York tend to be copied by other state legislatures. A trend to cap laboratory testing under Medicaid could even spread to the Medicare program.